A Ship, A Couple Of Startups And The Bay

If the Maritol - a ship docked on Pier 50 in the San Francisco Bay - were on the high seas, Paul Baumgart would be steering it. The twenty-five-year-old’s office is located in the ship’s Wheelroom.

The controls, dials, and levers cluttering the room are a distraction for Baumgart, however. This is because the software entrepreneur is busy navigating the choppy waters of entrepreneurship with his startup.

So, it is that, instead of admiring the magnificent views of San Francisco, Baumgart peers into his laptop.

“When you are coding, you can get in over your head,” says the San Diego native.

On a recent Sunday, Baumgart walked the narrow steps leading up to the ship's bolted doors, past the legal notice (that releases the ship’s officials from obligations to visitors in case of natural disasters) stuck on the door, climbed two flights of stairs and walked across the astroturfed deck to his office.

Paul Baumgart in his office inside The Maritol's Wheelroom

Part incubator and part community space, The Maritol has berthed on the Pier since 2011. It is an anomaly amidst regular business establishments, such as distilleries and warehouses on the Bay. But, the fact that entrepreneurs have laid claim to the waters is not surprising when you consider that the ship is berthed in San Francisco, a city where space is at a premium. The Icebreaker, as the incubator is known, functions as a community of sorts with journalists, marketing professionals, and hardware entrepreneurs as part of its posse.

Creon Levit, co-owner of The Icebreaker, says the ship combines two “desires” common to San Francisco’s inhabitants: the charm of living in a ship and the need for startup space. He bought the ship off Craigslist in 2011 for an amount between “tens of millions of dollars and tens of thousands of dollars."

Originally an Icelandic car ferry used to transport cargo across Scandinavia’s icy pathways, The Maritol is 38-years-old and earlier belonged to Swedish architect (and Bay Area resident) Olle Lundberg. He bought the ship for $260,000 from a website for decommissioned ships and had it transported here via the Panama Canal. Subsequently, he spent $600,000 renovating it into a home office.

Lundberg's Maritol (Image courtesy: The New York Times)

Images of the ship’s earlier avatar are available in a presentation prepared by Levit.

Liquers and books line the glass-paneled shelves around a long dining table in the lower deck of the ship in one photograph. The table is spread out with silverware and covered with a richly-embroidered cloth. In another photograph, a comfortable cabin invites viewers aboard the ship.

In its layout and decor, much of the ship remains same.

But, the freewheeling and functional mindset of entrepreneurs has been superimposed on its architecture. The ship's three floors are home to odd workspaces.

Desktops and laptops clutter porthole cabins and narrow spaces. The long dining table doubles up as a communal meeting spot for entrepreneurs to exchange ideas and notes.

“The ship has a delightfully large number of cubby holes and other such office type spaces,” says Stanford postdoc Adam Brown. The thirty-one-year-old British physicist was introduced to The Icebreaker by his girlfriend and, often, works on the ship. According to Brown, he is a crew member and a “steward of this awesome community.”

Brown is the odd one out.

Twenty-six-year-old Yale graduate Robert Martinez started www.supplybetter.com within The Maritol.

Levit says the ship is home to three full-time startups (or, all employees work out of the ship) and five or six part-time startups (or, employees are distributed across multiple locations). "There is a real wisdom to the design pattern of ships that architects and entrepreneurs have yet to fully understand," says Levit, with an expansive wave of his hand. The design pattern, he explains, has to do with the confluence of private and public spaces within a ship.

While that "confluence" may be a fanciful stretch, the ship's architecture has helped startups in more practical ways. For example, Matterport, a 3D scanning startup, used the ship's engine room to improve its technology. The ship's architecture also provides entrepreneurs with an excellent starting point for conversations. "It is so much cooler to ask people to hang out with you on a ship than the your startup's office breakroom," says Baumgart, who worked in a "cube farm" at Motorola earlier.

That said, there is no specific criterion for entry to The Icebreaker.

Some startups pay a membership fee. Others offer equity to the ship's owners. Still others pitch in with it’s maintenance (which is substantial for the 450-tonne vessel).While he has already paid membership dues, Baumgart also helped repair the ship last summer. “We repaired stuff and broke stuff,” he says. “Then, we brought people to repair the stuff we broke.”

One thing that definitely needs repairing is the ship's relationship with port authorities.

A Breach With The Port

On April 18 this year (about a month before The Icebreaker’s lease with the Port of San Francisco expired), Levit received a notice from port authorities stating that he was in “breach of obligations” of the lease he signed two years ago. Among other things, the notice states that The Icebreaker’s residents “encroached onto the Port maintenance parking lot,” and its management failed to maintain the ship in an operational manner (i.e., available to cruise around the Bay). The one-page notice also requested documents and receipts for The Icebreaker’s sewage and pumping facilities.

According to an official statement released by the Port in response to my query regarding the matter, Maritol Enterprises (the holding company for The Icebreaker) had used its premises for “uses not permitted under the lease.”

In an email response, Renee Martin, spokesperson for the Port of San Francisco, clarified that the The Maritol had a berthing lease, which did not include “office space, special events and other activities such as living on board.”

Since May this year, the ship is berthed on the Bay as a “holdover tenant.” Levit searched for berthing spots at other ports in the Bay, including Alameda and Redwood city but was unsuccessful. Subsequently, he listed the ship for sale and discussed “maintaining continuity” of the incubator brand. Several entrepreneurs have shifted or are in the process of moving. Baumgart says the uncertainty led him and his business partner to search for incubator spaces in San Francisco. The ship’s inmates also started an online petition to publicize their plight recently.

Levit says the notice is the result of misunderstandings and natural tension between port authorities intent on “optimizing” the port for a broader audience and the ship’s inmates who are “young, opinionated, and self-important.”

The 53-year-old Levit has emerged as an unlikely mediator to resolve this tension. With his frizzy hair and colorful shirt (that he was wearing the day I met him), physically at least, Levit cut an unlikely figure for this task.

Having worked as a NASA scientist for thirty years, however, Levit is familiar with the ways of large organizations. “Both groups (entrepreneurs on his ship and port authorities) have valid concerns but, sometimes, it is hard to make an impedance match,” he says.

Several incidents have contributed to the impedance mismatch.

“We were physical in the beginning,” says Levit. That “physical” attitude translated into holding a wedding onboard the ship on the same day that a port official made a surprise visit and having large parties, which attracted crowds and made noise.

In recent times, Levit has clamped down on such celebrations. “They are not worth the effort,” he says. “We want to be good citizens and contribute to the environment here.”

Then, there was the problem with sewage services.

Back in 2011, The Icebreaker’s sewage lines were cut off (along with the rest of Pier 50). To deal with the matter, the ship hired a sewage holding tank and a trucking company that empties the tank on a weekly basis.

However, Levit says port authorities have continued to charge the ship for sewage services. The result is confusion.

“One branch cuts off our service, another bills us (for disconnected services) and a third department tells us that we are in violation of our terms of lease (because they are being billed for a disconnected service),” says Levit, adding that such incidents are common in large organizations, whether private or public.

The Icebreaker’s case is complicated by the fact there are no development plans for Pier 50 in the near future. In San Francisco, which is the second-most expensive real estate market in the country, piers are especially prized swathes of real estate for land developers. Pier 38, which was home to startups and tech firms briefly last year, is already on the block for redevelopment.

A Safe Passage?

The port authorities softened their stance towards the ship recently and invited them for negotiations. Given the spate of development, rising rents, and lack of retail space within the city, it might be just a matter of time before Pier 50 is redeveloped into a glitzy retail and tourist destination.

Levit realizes this. But, he is keen to maintain The Icebreaker incubator.

“They work well together as a team,” he says, referring to the community he has built up inside the ship.

Will the inmates regroup again on another ship? I asked Levit.

“Probably, on land,” he replied. “I have had enough with ships.”

I am a freelance journalist interested in the intersection between business, technology and society. I worked for a number of years in the IT industry in India before shifting careers to journalism. I graduated from the Medill School of Journalism at Northwestern University ...